Skip to content


Rambala Mulaswami and ors. Vs. G. Sreeramamurti and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil;Tenancy
CourtAndhra Pradesh High Court
Decided On
Case NumberAppeal No. 534 of 1954 and memorandum of cross objections
Judge
Reported inAIR1960AP520
ActsCode of Civil Procedure (CPC) , 1908 - Order 8, Rule 6
AppellantRambala Mulaswami and ors.
RespondentG. Sreeramamurti and ors.
Appellant AdvocateB.V. Subrahmanyam and ;V.V. Krishnamurthi, Advs.
Respondent AdvocateAdv. General and ;Suryanarayana, Adv.
DispositionAppeal allowed
Excerpt:
tenancy - examination of accounts - order 8 rule 6 of code of civil procedure, 1908 - plaintiffs carried on paddy business on lands leased from defendants - defendants filed suit for recovery of amount which they felt was due in transaction - question regarding what accounts to be examined for determination of amount due - held, current and open accounts to be examined not mutual accounts. - all india services act, 1951.sections 8 & 11 & a.p. buildings (lease, rent and eviction) control rules, 1961, rule 5: [v.v.s. rao, g. yethirajulu & g. bhavani prasad, jj] refusal by landlord to receive rent - deposit of rent in court - held, a tenant has the option to take recourse to section 8 in case of refusal or evasion by landlord to receive rent and if landlord were to not name a bank or.....krishna rao, j. 1. the two plaintiffs constituted a firm of which the 1st plaintiff, golakoti sreeramamurty, was the managing partner. they carried on trade in paddy, rice etc. from 1-1-1949 till the end of that year in the jayalakshmi jayarama rica mill, which they took on lease for a rent of rs. 4,000/- from the 1st defendant, rambala mulaswami. defendants 2 to 6 were the undivided sons of the 1st defendant, who was the manager of their joint family. the family owned extensive lands besides the aforesaid rice mill and sold quantities of paddy to the plaintiffs, receiving payments from time to time. the suit was brought to recover, with subsequent interest and costs, an amount of rs. 5927-5-9, claimed as due in respect of these transactions, on what was alleged by the plaintiffs to be a.....
Judgment:

Krishna Rao, J.

1. The two plaintiffs constituted a firm of which the 1st plaintiff, Golakoti Sreeramamurty, was the managing partner. They carried on trade in paddy, rice etc. from 1-1-1949 till the end of that year in the Jayalakshmi Jayarama Rica Mill, which they took on lease for a rent of Rs. 4,000/- from the 1st defendant, Rambala Mulaswami. Defendants 2 to 6 were the undivided sons of the 1st defendant, who was the manager of their joint family. The family owned extensive lands besides the aforesaid rice mill and sold quantities of paddy to the plaintiffs, receiving payments from time to time.

The suit was brought to recover, with subsequent interest and costs, an amount of Rs. 5927-5-9, claimed as due in respect of these transactions, on what was alleged by the plaintiffs to be a mutual, open and current account kept between them and the defendants in the regular course of business. The amount claimed was made up of a principal sum of Rs. 5,212-6-6, being the balance due up to 19-10-1949 as per the account memo filed along with the plaint and interest Rs. 714-15-3 thereon from 19-10-1949 to 16-4-1952, the date of the plaint.

The learned Subordinate Judge found that there was no agreement for the payment of interest! and therefore disallowed interest for the period from 19-10-1949 to 1-4-1952, the date of the plaintiffs' notice of demand before the suit. No question arises as to the correctness of this portion of his Judgment. He also disallowed two items of Rs. 1,000 and Rs. 230 respectively which were debited to the defendants in the plaint account and decreed the suit for a principal sum of Rs. 3,982-6-0 With interest thereon from 1-4-1952. The defendants have preferred the appeal on the ground that credit ought to have been given to them in the plaint account, for the rent of Rs. 4,000/- due from the plaintiffs. The plaintiffs have filed Memorandum of cross-objections, claiming the Rs. 1,230/-disallowed by the court below.

2. With regard to the defendants' claim for the rent, the plaintiffs' case which prevailed with the learned Subordinate Judge was that it had been adjusted separately on 13-3-1950 and did not remain due to the defendants. Sri B.V. Subrahmanyam, the learned Counsel for the appellants, assails the correctness of this finding on the merits of their claim. The learned Subordinate Judge also appears to have assumed that the claim for rent was not maintainable by way of a defence, because it was not put forward as a counter-claim or as a set off. This view of the legal position is attacked by Sri B.V. Subrahmanyam as being erroneous.

3. In order to understand the controversy about the alleged adjustment of the rent, it is necessary to refer to some more facts. It is common ground that prior to 1-1-1949, the 1st plaintiff had carried on trade in the same mill in partnership with the 1st defendant. The 1st defendant was the financing partner and the 1st plaintiff was the managing partner. While the defendants' version was that the 1st defendant invested over Rs. 70,000 in that venture, the 1st plaintiff' was prepared to concede that the 1st defendant invested only Rs. 30,000 to Rs. 35,000 by borrowing from others. Admittedly, that partnership (which may be called the first partnership) came to an end on 31-12-1948.

The defendants began to be exercised (sic) even in December 1948 over the accounts thereof maintained by the 1st plaintiff, because no returns materialized. The 1st plaintiff seems to have kept them in hope of profits, by giving out that there were secret accounts for blackmarketing transactions. They made various attempts to settle the accounts and even locked up the mill for a few days, in or about April, 1949 during the currency of the lease obtained by the 1st plaintiff on behalf of the partnership with the 2nd plaintiff (which may be called the second partnership). The quarrels between the parties became bitter. A cyclone damaged the mill on 27-10-1949 and the 1st plaintiff issued a notice to the 1st defendant to effect necessary repairs.

The 1st defendant replied declining to effect any repairs and demanding payment of the rent of Rs. 4,000 and giving the 1st plaintiff the option of handing back the mill. The business of the second partnership had to be stopped as the mill was not repaired. But the 1st plaintiff did not surrender the mill nor pay the rent, although he admits at one stage in the course of his evidence that ha owed the Rs. 4.000 for rent on the date of the 1st defendant's reply. Finally on 13-3-1950, there was a mediation by the 1st plaintiff's brother, Golakoti Satyanarayanamurti and the defendants' relation, Ryali Satyanarayanamurti (D.W. 5), On the side of the defendants, who had only oral accounts, Various claims were made at the time. But the 1st plaintiff's brother advised them that it would not be possible to recover anything from the 1st plaintiff. The 1st plaintiff and the 1st defendant exchanged letters embodying the settlement which was reached. Ex. B. 1 is the letter executed in favour of the 1st defendant by the 1st plaintiff and reads thus :

'While I have taken on lease the Sri Jayalakshmi Jayarama Rice Mill, belonging to you, and. situate in Konkapalli village, on account of the cyclone occurred on 27-10-1949, the peepal tree on the side of the mill fell On the mill and a portion of roof fell in. As it waj not possible to carry on business, a notice was issued to you to get the mill repaired immediately; thereupon you told that it would not be possible at that time to get the mill repaired and that in case I sustain any loss, the mill might be handed over to you. Hence I have handed over the said null to you this day, in its working condition together with all the accessories therein.

In order to get transfer all the licences relating to the said mill in the name of your son, Swami Naidu. at your request, I gave all the licences and petitions to you. All the joint business carried on by me and you previously has been wound up this; day by way of this letter. All the books relating to the said joint business are given, to you. I shall transfer to you all the debts mentioned in the account. As you have execited a counter letter, have executed this letter in your favour. To this effect is the letter executed by me with consent.'

(Signed in Telugu on one anna revenue stamp) Golakoti Sreeramamurthi 13-3-1950 Witnesses thereto.

1. sd/- in Telugu. Golakoti Satyanarayanamurthi.

2. sd/- in Telugu. Ryali Satyanarayanamurthi'.

4. It is agreed by both sides that the settlement related only to the affairs of the first partnership. Nevertheless, the plaintiffs' case is that the rent of Rs. 4,000 due by the second partnership to the 1st defendant was also adjusted at that time towards the 1st plaintiffs claim against, the 1st defendant. The defendants' case is that there was no such adjustment of the rent and, therefore, they are entitled to take credit for the amount in the plaint account.

5. Admittedly, there is nothing whatever in writing, to which any of the defendants was a party that mentions the adjustment of the rent set up by the plaintiffs. There is no entry relating to it in any of the books of the first partnership, and the 1st plaintiff's explanation is that they were written up only to 31-3-1949. He admitted in the witness box as P.W. 1 that Medi Satyam, who examined the accounts at the instance of the defendants, returned the books to him in or about October 1949 and there was no reason for his not making entries in them subsequently. Anyhow Ex. B. 1 and its counterpart form the only documentary evidence of a bilateral character regarding the settlement effected on 13-3-1950.

The counterpart of Ex. B. 1, which must be in the possession of the 1st plaintiff, has not been produced. But it is common ground that the counter-part is in the same terms as Ex. B. 1. A perusal of Ex. B. 1 discloses nothing whatever, either expressly or by necessary implication, about the adjustment of the second partnership's liability to pay Rs. 4,000 as rent. The first part of Ex. B. 1 deals with the lease of the mill, which was obtained by the 1st plaintiff on behalf of the second partnership: With regard to that matter, no adjustment of any obligation is mentioned or indicated, beyond the restoration to the lessor of the property demised, '

This is consistent with the agreed fact that the settlement related only to the affairs of the first partnership. The second part of Ex. B. 1 deals with the settlement reached about the first partnership. The 1st plaintiff, who had been the managing partner, hands over all the books of the firm to the other partner and undertakes to assign to the latter all the debts due to the first partnership. If one of the terms of the settlement was that a collateral liability of the 1st plaintiff should he adjusted towards his claims against the 1st defendant, it would have been naturally mentioned at least in the second part of Ex. B 1. It is plain that Ex. B. 1 does not advance the plaintiffs' case.

6. The affirmative evidence on the side of the plaintiffs to prove the alleged adjustment of the rent consisted of the interested oral evidence of the 1st plaintiff himself and of the entries made or caused to be made by him in the books of the second partnership. Tie plaintiffs did not call either of the mediators, not even the 1st plaintiff's own brother, to support their story. According to D.W. 5, the other mediator there was no adjustment, of the rent, the settlement did not relate to the dealings with the second partnership at all and the object was merely to enable the defendants to salvage whatever they could from the 1st plaintiff. The terms of Ex. B. 1 completely support the view that such was the object of the settlement.

7. With regard to the entries concerned in the books of the second partnership, viz., the ledger and the daybook, all of them bear only the date 25-4-1950, about six weeks after the date of the settlement. The trial Judge proceeded on the footing that they were made on 25-4-1950. But so far as the entries in the ledger are concerned, they ara the closing entries in the folios Exs. A. 20 and A. 22 of the ledger Ex. A. 5 and could have been made at any time before the book was put into court. In the day book Ex. A-2, the position of the relevant entry Ex. A. 26 is very significant. Ex. A 26 is found among a long batch of entries bearing the date 25-4-1950, and next below them is the Deputy Commercial Tax Officer's signature dated 14-3-1951.

The previous batch of entries bear the date 11-3-1950. Below the Deputy Commercial Tax Officer's signature, there are seven entries without date and the next batch of entries is dated 10-5-1951. It is manifest that the entry Ex. A. 26 might have been made at any time before the Deputy Commercial Tax Officer appended his signature on 14-3-1951. In other words, it cannot be even said with certainty that the 1st plaintiff, who caused the entry to be written by the ex-gumastha P.W. 2, made up his mind about the adjustment of the rent at least six weeks after the settlement. It is unnecessary to pursue this aspect of the matter, as the 1st plaintiff himself has admitted that 'the Chitta was not posted in regular course of business subsequent to the closing of my personal business.'

Even his next assertion that the accounts were posted from entries on slips of paper is contradicted by P.W. 2, who said : 'The transactions used to be mentioned to me orally and not from any papers.' The closing of the personal business mentioned by the 1st plaintiff has reference to the stopping of the second partnership's business after the cyclone of 27-10-1949. As the books were admittedly not maintained in the regular course of business thereafter, the entries bearing the date 25-1-1950 in Ex. A. 20, A. 22, and A. 26 can have little evidentiary value. It has to be noticed that the entries themselves do not make any mention of the settlement of 13-3-1950 and they are dovetailed to that settlement only by the oral evidence of P.Ws. 1 and 2.

8. The trial Judge recognised that Ex. B. 1 does not assist the plaintiffs' story of the adjustment of the rent and that the entries in Exs. A. 20 and A. 22 which appeared to him to have been made on 25-4-1950 were belated. He based his conclusion as to the truth of the alleged adjustment on certain probabilities and adverse inferences.

9. The first probability proceeded on the footing that the total loss incurred by the first partnership was Rs. 25,000 out of which the 1st plaintiff's one-fourth share was Rs. 6,000, that the 1stplaintiff paid off its debts to the extent of Rs. 10,000 as per Ex. A. 20 and that the 1st plaintiff would naturally have sought reimbursement of Rs. 4,000 from the 1st defendant at the time of the settlement. But the case as to the amount of the loss incurred by the first partnership and the division thereof between the 1st plaintiff and the 1st defendant, is entirely founded on the 1st plaintiffs own oral evidence. The learned Advocate General for the respondents-plaintiffs contends that the defendants, who were in possession of the books of the first partnership after Ex. B. 1, ought to have confronted the 1st plaintiff in the witness-box with the books, if they disputed the figures given by him. The contention has no substance in the face of P.W. 1's own admissions which read:

'I had not recorded anywhere that the total losses were Rs. 25.000/- ....... I do not have any documents to show that debts to the tune of Rs. 25,000 had arisen. The mediator said so. He is my brother. I accepted his statement without verification.'

It is plain that the whole story about the assessment of the loss and the division thereof rests upon the 1st plaintiff's oral evidence and is devoid of any corroboration. Even as to the payment by the 1st plaintiff of the debts of the first partnership, Ex. A. 20 purports to be an account of the first partnership with the second partnership. But the 1st plaintiff says that he paid his own moneys thereunder and is contradicted on the point by P.W. 2. The entries are not supported by any vouchers. The basis for the 1st plaintiff claiming any reimbursement at the time of the settlement of the affairs of the first partnership is not established. D.W. 5's evidence shows that no attempt was made at the time of the settlement to go into the profit or loss of the first partnership, because it was recognised that nothing could be recovered from the 1st plaintiff. The 1st plaintiff's self-serving oral evidence as to the extent and the apportionment of the loss incurred by the old partnership is merely a belated ramification of his story about the adjustment.

10. The second probability adverted to by the learned trial Judge proceeded on the footing that the question of the payment of rent due by the second partnership must have been necessarily decided when the mill was handed back to the 1st defendant, because that question had been raised by the 1st defendant during the earlier exchange of notices mentioned in Ex. B. 1. This ignores the fact that in Ex. B. 1 there is absolutely no mention of the rent. The learned Advocate General points out, from the 2nd defendant's evidence, that the defendants looked to the 1st plaintiff alone for the payment of the rent. No doubt there is nothing unlikely in the question of the payment of the rent by the 1st plaintiff having come up for discussion on 13-3-1950. But the point for determination is whether it was adjusted in the manner alleged by P.W. 1.

He does not say that he refused to hand over the mill unless the claim for rent against the second partnership was adjusted. His only case is that the adjustment took place, because he had a claim against the 1st defendant for about Rs. 4,000/- in respect of the affairs of the first partnership. Apparently, by a curious coincidence, his claim against the 1st 'Defendant was more or less equal to the amount of the rent. I have1 already shown above that his claim is untenable and it follows that any discussion that might have taken place about the rent has no bearing on the truth of the adjustment. The learned trial Judge drew an adverse inference from the 3rd defendant's answer in cross-examination,

'On the date of Ex B. 1, P.W. 1 owed us Rs. 4,000 for rent and Rs. 1,800 for price of grain. The mediators asked us to give up both the items. I do not remember if we had agreed to give up these or not.'

Paragraph 4 of the written statement makes it clear that according to the defendants, a sum of Rs. 1.800 remained due to them in respect of the dealings with the second partnership. They had only oral accounts and were unable to prove that. The learned trial Judge did not believe the 3rd defendant's answer that he did not remember whether the rent was agreed to be given up and inferred that the 3rd defendant was conscious of the adjustment as alleged by the plaintiffs. It appears to me that the inference is too farfetched and is divorced from the context of the 3rd defendant's answers.

The case of the defendants is that the mediators advised them that they could not recover anything from the 1st plaintiff and therefore they were unable to press all the claims they could have made at the time of the settlement. The 3rd defendant's answers are consistent with this situation and he was naturally unable to remember whether their claims against the second partnership were given up by express agreement or only by implication. He cannot be taken to have meant that the claim for rent against the second partnership was assigned for the benefit of the 1st plaintiff, under the settlement of the affairs of the first partnership.

11. Another adverse inference drawn by the learned trial Judge was based On the defendants' omission to claim Rs. 4,000 in their reply notice Ex. A. 24. But as urged by Sri B.V. Subrahamanyam the omission appears to have been due to the fact that the plaintiffs did not give any particulars for the balance of Rs. 5,212-6-6 claimed by them in their notice Ex. A. 23 and the defendants who had only oral accounts, were not in a position to know whether credit had been given to them for the amount of the rent. It is the case of the defendants that they were not aware of the relationship between the two plaintiffs inter se. The 2nd plaintiff was not in evidence in any of the transactions between the parties prior to the notice Ex. A. 23.

The defendants seem to have thought that they had to do with the 1st plaintiff alone and that everything between them and the first plaintiff had been settled on 13-3-1950. A perusal of Ex. A. 24 shows that they were labouring under this mistaken impression and referred only to the first partnership, not realising that the second partnership was a separate, entity. Their omission in Ex. A. 24 to claim the amount of rent as an item in the account would stand on the same footing as their omission to attack the rest, of the account item by item. It is plain that no inference in favour of the adjustment set up by the plaintiffs can be drawn from the defects in Ex. A-24, just like no inference can be drawn with regard to the other items in the account.

12. There remains the adverse inference drawn by the learned trial Judge from the defendants' omission to plead a counter-claim or set off in respect of the amount of the rent for which they claimed credit. This omission was considered as a piece of conduct showing that they knew that the rent had been adjusted. It is difficult to appreciate the reasoning, because the defendants specifically alleged in paragraphs 2 and 5 of their written statement that the rent due had been deliberately omitted and had to be credited to them in the plaint account. If it was found that the procedure adopted by them was defective and did not comply with the requirements of law, it could be held that they are not entitled to the relief of having the amount credited.

It would be too farfetched to infer that they deliberately adopted an erroneous procedure, as they were aware that their claim had no substance. Sri B.V. Subrahmanyam urges that the only fault with which the defendants can be charged is the non-payment of the requisite court-fee and that it was due to a mistake and inadvertence on their part. He relies on Faizulla Khan v. Mouladad Khan, AIR 1929 PC 147, Maneklal Vadilal v. Chandulal, AIR 1926 Bom 343 and Jitendranath v. Inanada Kanta Das, AIR 1936 Cal 277 for the position that the case would be a fit one for invoking the Court's powers under Section 149, Civil Procedure Code and Section 28 of the Madras Court Fee Act VII of 1870 and granting the appellants a short time for the payment of any court fee adjudged to be due.

13. This leads me to the question whether the appellants' defence that the rent due to them ought to be credited in the plaint account is not maintainable except as a counter claim or a plea of set off. The plaintiffs sought to recover the balance ascertained by them on what they alleged to be a mutual, open and current account. The learned Subordinate Judge held that as there were no reciprocal obligations, it was only a running account and that the plaintiffs are not entitled to invoke Article 85 of the Limitation Act. This means that the test of mutuality enunciated in the leading case of Hirada Basappa v. G. Muddappa, 6 Mad H.C.R. 142, was not satisfied and that it was only an open and current account.

It is unnecessary for the present purpose to consider whether the learned Judge was right in his view that the account was not mutual. Assuming that it is only an open and current account, the legal consequence is that either party had a right against the other to an account and that whoever was shown to be the debtor on taking accounts, was hound to pay his debt to the other -- Maniram v. Seth Rupchand, 33 Ind App 165 at p. 171 (PC). It is admittedly not a case of an account stated or settled, in which even the party seeking to reopen the account would have to establish fraud or mistake or some other equitable ground justifying that course. The cause of action is the right of either party to have an account and it goes without saving that the account must be correctly taken.

In such a case, it is open to either party to show that one or more items have been omitted to be entered in the account, just as it would be open to show that they ought not to have been entered or have been entered incorrectly. No question arises of a counter-claim, which is in substance a cross action or a plea of set off by which a defendant prays for the satisfaction or extinguishment of the plaintiffs debt with effect from the date of the plea. When, as here, the defendants pleaded that a particular item has been omitted in the account, they were merely attacking the correctness of the plaintiff's statement of the position of the account, which formed the basis to the action and were not importing a different or a subsequent cause of action. It is clear that the defendants' plea is not in law a counter-claim or a set off.

14. In Narasimha Rao v. Zamindar. of Tiru-vor, ILR 42 Mad 873: (AIR 1920 Mad 819), an agent sued his principal for the balance shown in the plaint account and for damages for the breach of the contract of agency. The principal challenged the correctness of the plaint account and alleged that upon proper accounts being taken a balance would be found due to him in respect of which he was about to take steps against the agent. On a subsequent date, he asked for a decree in his favour for the amount due to him on taking the accounts.

But by that date the principal's right of action was barred under Article 89 of the Limitation Act; The Division Bench held that the agent's suit was rightly dismissed, but that there could be 110 decree in the principal's favour as his claim was barred by time, Phillips, J., said that it was not disputed that the principal's claim must be allowed to the extent of the agent's claim and the agent's suit dismissed. Sri B.V. Subramanyam relied on the observation of the other learned Judge Bakewell, J. which is as follows:

'I think, that since the defendant's claim was not barred at the date of the suit, he was entitled to plead that there was a sum in the plaintiffs hands which the latter was bound under his contract to apply in satisfaction of his demand.'

Two more cases where the question of counterclaim or set off arose in connection with the payment of court-fee thereon by the defendant, have also been cited for the appellants. In Balgis Beevi Ammal v. Hathija Beevi Animal, AIR 1933 Mad 353 (I), the defendants made various claims as to the items in the partition account to be taken in the suit. Pandalai, J. held that it was not a counterclaim by the defendant and that court-fee was not payable thereon. In Koyan v. Rajammal, : AIR1953Mad853 , the suit was for rent and the defendant claimed two items of credit with reference to what would be in the nature of an advance payment of rent or payments under the Madras Tenants and Ryotwari Protection Act! 17 of 1946. Raghava Rao, J. held that no court-fee was payable in respect of them.

15. The. learned Advocate-General does not seek to maintain that the appellants made a counter-claim or pleaded set-off nor cite any authority for such a position. His contention is that under the agreement or arrangement between the parties by which the running account was opened and maintained by the plaintiffs, the rent was not intended to be included as one of the items. Admittedly, there was no express agreement on the matter and it has to be inferred from the conduct of the parties.

Reliance is placed on the fact that in the plaintiffs' ledgers all the transactions constituting the plaint account are entered in folios which bear the heading 'Rambela Mulaswami Garu resident of Uppudi', while the rent is entered in separate folios which bear the heading 'Rambala Mulaswami Garu No. 2 Khata'. But the defendants are not shown to have been parties to the separate treatment of the rent, because their signatures were obtained only in the day-books and not in the 'ledgers. The account of rent might have been kept separately in the ledgers of the plaintiff, merely as a classification for their convenience. The headings do not indicate that there was a classification based on the difference in the category of the transaction. The balance struck under the account in No. 2 khata could at any time have been transferred to the other account, which comprehensively related to all the dealings.

It cannot he said that the existence of the two sets of folios in the plaintiffs' ledgers is a piece of unequivocal and unambiguous conduct on their part, which relates back to an arrangement for treating the rent separately. The learned Advocate-General relied on the admissions of the defendants that they treated the 1st plaintiff alone as the lessee and looked to him alone for the payment of the rent. But these admissions have to be understood in their context of the defendants not being aware of the relationship between the two plaintiffs inter se and not knowing the 2nd plaintiff at all. The 1st plaintiff alone is mentioned in the titles of the books in which the defendants' signatures were obtained.

It appears that the defendants dealt with the 1st plaintiff alone in all their transactions although the transactions after 1-1-1949 actually related to the second partnership. There was no reason whatever for the defendants to regard the lease transaction as distinct from the other transactions. I must therefore reject the contention that there was an agreement or arrangement which disentitled the defendants from claiming that the rent due to them ought to be included in the plaint account.

16. Turning to the cross-objections, the contention of the learned Advocate-General is that the learned Subordinate Judge erred in finding that their payment to P.W. 3 of Rs. 1,000 on 12-7-1949 and of Rs. 230 on 22-7-1949 were not authorised by the defendants or were received by P.W. 3 on behalf of the defendants. He urges that the accounts have been proved to have been maintained in the regular course of business at least upto October, 1949 and that the two debits against the defendants are not at all likely to have been false. He urges further that as P.W. 3 was the Gumastha of the first partnership, the defendants are likely to have sent him to receive the payments on their behalf and the plaintiffs would have naturally not expected letters of authorisation signed by the defendants.

But the learned Subordinate Judge has carefully considered the oral evidence of P. Ws. 1 and S as to the circumstances in which the amounts were paid to P.W. 3 and pointed out the discrepancies and improbabilities therein. Admittedly, disputes between the parties had arisen before the dates of the payments. It is therefore difficult to believe that without anything in writing from the defendants, the plaintiffs would have paid such considerable amounts to P.W. 3 on their behalf. I see no reason to differ, from the learned Subordinate Judge's appreciation of the evidence on this part of the case.

17. It follows that the cross objections must be dismissed with costs.

18. I find that the adjustment of the rent set up by the plaintiffs is not proved to be true and that the defendants are entitled to a credit of Rs. 4,000 in respect of the rent in the plaint account. They have not asked for a decree for the amount which might be found due to them. In the result, the appeal is allowed and the suit is dismissed with costs throughout.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //